President Obama speaks from the Rose Garden about his deficit-cutting plan. — Photo by: Jason Reed/Reuters

"We came out of this much better than we thought we would even a few weeks ago," said Max Richtman, head of the National Committee to Preserve Social Security and Medicare. "On balance, it's a very good plan."

Republicans immediately assailed his tax hikes on the wealthy as a threat to the economy and criticized him for not seriously tackling expensive entitlement programs.

"Pitting one group of Americans against another is not leadership," said House Speaker John Boehner, R-Ohio. "This administration's insistence on raising taxes on job creators and its reluctance to take the steps necessary to strengthen our entitlement programs are the reasons the president and I were not able to reach an agreement previously, and it is evident today that these barriers remain."

"Either we ask the wealthiest Americans to pay their fair share in taxes, or we're going to have to ask seniors to pay more for Medicare. We can't afford to do both," Obama said in a Rose Garden speech.

The Obama package would cut $3 trillion of deficit spending over the next 10 years if it passed — a tall order given GOP objections. But a bipartisan congressional committee is working on cutting federal spending, and if it can't win final approval for at least $1.2 trillion in cuts before the end of the year, automatic spending cuts will kick in.

Not long ago, the president had offered major cuts in entitlement spending as he tried to win a deficit reduction deal with congressional Republicans and signaled he could support raising the Medicare normal retirement age to 67.

But the latest plan makes no change to Social Security. The vast majority of the $248 billion in Medicare cuts he proposed would come from reducing overpayments, according to the White House. Any changes that affect beneficiaries would not kick in until after 2017.